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‘Proposed tax policy may hurt businesses’

Traders have opposed Delhi government's tax proposal for the textile industry

Policy Pulse
Publish Date: Mar 30 2016 12:27PM | Updated Date: Mar 31 2016 11:18AM

‘Proposed tax policy may hurt businesses’

Traders have opposed Delhi government's tax proposal for the textile industry.

 
They feel unvarying rate of 5 percent on all variations of textiles and fabrics except handloom and khadi ones would see a flight of customers to nearby states.
 
According to Sanjiv Mehra, president, Khan Market Traders', finished products would cost 5 percent more too. Buyers would look at Gurgaon and other parts of Haryana because of this and Delhi would lose its distribution character
 
J B Soma, member of The Textile Association, said traders would request government to junk the hike.
 
Traders were also of view that other manufacturing centres like Mumbai, Surat, Erode, Malegaon,   Kanpur, Gorakhpur, 
Ludhiana and  Amritsar levy no blanket VAT on textiles and fabrics. 
 
"I think it's plain irrational to slash tax on ready-made garments that cost over Rs 5,000 to 5 percent, but levy 12.5 percent tax on cloth that costs Rs 50," said Mehra.